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Fire district weighing impact of increased property values

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By John Colson

Sopris Sun Correspondent

Property values jumped this year by an average of 25 percent within the boundaries of the sprawling, 320-square mile Carbondale & Rural Fire Protection District, according to Garfield County Assessor Jim Yellico, but it is not clear whether the resulting rise in fire district revenues will be enough to avoid a tax-hike ballot question in November.

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Yellico, who issued notices of assessed valuation more than a week ago, stressed that the new property-value numbers must be viewed as an average, meaning some property values rose more and some less than that average.

Plus, Yellico emphasized, the numbers at this point are preliminary, subject to change due to a variety of factors over the coming months — factors that will include challenges to the assessed values assigned to particular residential or commercial properties, and the possibility that errors in the assessor’s data could result in revisions before the final numbers are known in late summer.

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According to the chairman of the fire district’s board of directors, even considering the recent increase in property values, and the resulting boost to the fire district’s annual income, that may not be enough to prevent a third ballot question in five years to persuade fire district voters to approve a tax hike meant to increase the district’s revenues.

Gene Schilling, in a telephone interview this week, noted that the district lost approximately 40 percent of its annual revenues due to the slump in property values — the district’s main source of funds — over the course of the last half-dozen years or so.

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Schilling reasoned that a rise of 25 percent or so in district property values would result in a recovery of roughly the same percentage in tax receipts for the district’s coffers, which he estimated could amount to $450,000 or so.

“I don’t think that will get us back to even,” he said.

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The district budget stood at about $3 million prior to the drop in property values, Schilling said, adding that the budget subsequently shrank to its current level of about $1.8 million, representing a loss of approximately $1.2 million.

Assuming the newly increased property values would mean an injection of about $450,000, Schilling said, “We’re still about $800,000 shy” of regaining the totality of lost revenues.

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Over the last few years, Schilling said, the district has nearly depleted its reserve account — money the district had saved to deal with emergency needs — in order to maintain its levels of service in both fire-fighting capabilities as well as its expensive, paramedic-level ambulance service.

District officials have said the level of budgetary reserves is deemed to be too low to provide enough to maintain services at their pre-recession level.

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Personally, Schilling continued, he feels the district needs to boost its revenues, meaning “we would probably want to look at some sort of tax question in November,” though he conceded that is up to the board of directors.

Schilling said the board is awaiting completion of a new master plan for the district, which is being put together by a team of consultants and a steering committee, that are analyzing the district’s operational financial needs as well as holding community meetings to gauge voter sentiment about precisely what kind of emergency fire and medical service is supportable or desired by the district’s constituents.

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Local consultant Mark Chain, who is one of those working on the master planning process, said on Tuesday that a survey of district voters is expected to be conducted later this month to determine what level of service the people want from their fire department.

Chain also said the consultants are working toward completion of the master plan in late July, which would give the fire board time to decide whether to go for another tax election this year.

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District voters in 2011 approved a two-year “mill levy override” that raised district revenues by approximately $775,000 annually. But due to a “sunset clause,” that override expired in 2013.

When the district asked voters in 2013 to approve an open-ended tax-rate hike to make up for the lost tax revenues of the previous few years, the electorate turned the district down.

At the time, observers contended that the lack of a sunset clause — a legal mechanism that puts a time limit on the tax increase — was the reason the ballot question was defeated in 2013.

Voters were concerned, according to some, that property values would rebound over time, and that the district could not be counted on to scale back its tax rate in response to the rising property values.

Schilling, speaking for himself and not the board as a whole, mentioned that he would not be opposed to having a sunset clause as part of a ballot question in November, if that is how the fire board wants to proceed.

Published in The Sopris Sun on May 14, 2015.